A business model is a key in any company’s work, which shows what, to whom, and how exactly to sell, as well as how profitable a product or service is. It is considered the quickest and most efficient analysis of any business, allowing us to understand the following points:
• the position of the company in the market;
• how to optimize all processes and make them more effective;
• resources that should be engaged for business development.
Some models are suitable for both startups and already operating businesses. Сlassic e-commerce models can be applied in any sphere, whether a steel plant or a casino with online slots. Those who are just launching a company have the opportunity to analyze the niche and evaluate all possibilities and risks.
Leading a successful business requires a thorough analysis. And business models are the best way to schematically describe the future monetization of a company.
Moreover, it is a clear presentation of what, to whom, and how to sell, as well as how profitable services or goods are. This information is also essential for investors who are trying to decide whether to give money to a certain company. Below, more details about each model and key factors for evaluation are presented.
Business Models Structure
There are numerous points that should be evaluated when building a business, and it’s extremely important to consider each of them. The basic structure includes nine factors:
1. key partners (for instance, suppliers) and all actions they perform for a business;2.
2. key processes (how they are held, how a business solves any problems, how it supports itself);
3. value propositions (what does a business offer, why should clients choose this company);
4. key resources (financial and human resources)
5. customer relationships (how to attract new clients and keep them, ways to help customers);
6. customer segments (what do clients want, how much people are ready to pay for goods or services);
7. cost structure (how much does a company pay, how to cut costs without sacrificing quality);
8. communication channels (the way a business presents its product);
9. revenue streams (pricing policy).
Each of the mentioned points should be evaluated thoroughly. It will allow showing all the prospects and weaknesses of the business, as well as better analyzing the behavior of potential buyers. Resource planning, both financial and otherwise, is also a key factor in the success and failure of an organization.
Business To Business
As can be understood from the name, this model implies interaction between two companies. For instance, a wholesaler provides goods to certain shops, where final consumers can eventually get the goods.
Business To Customer
This is a model familiar to all of us that connects the client directly with the business. For example, if a person wants to buy a sofa, they just come to the store and get the necessary item.
Customer To Customer Model
This model characterizes transactions between two individuals. For example, a person needs to sell a car and puts up an advertisement for its sale. Of course, it’s the simplest way to sell any assets, which implies interaction between two people.
Customer To Business
Here, one individual provides their one-time or permanent service to the company. These concerns such jobs as copywriter, photographer, blogger, etc. In simple words, a consumer provides goods to a business, which is the opposite of the B2C model.
Business To Government
It is a kind of B2B business, but the government acts as the second organization. Such companies are used by the government to trade and exchange information with various business organizations.
Government To Business
This model is also about the interaction of a certain business and government. As a rule, such companies deal with tenders and auctions and perform bidding functions. In this case, the initiative comes from a business, opposite to the B2G structure.
Government To Customer
In this case, the government uses the model to directly approach citizens. For instance, it includes providing services of marriage, registration for birth, car auctions, and many other options. The main aim is to quickly proceed with people’s requests and provide high-quality government services.